Kristine Forbes not in favor of blaming Brexit for weakness

UK economy just grew 0.4% in first quarter of 2016, compared to 0.6% in the previous one but Kristine Forbes, member of monetary policy committee (MPC) of Bank of England, is not ready to blame next month’s referendum to recent weakness in British economy.

“We don’t have concrete evidence that some of the softening we are seeing now is all referendum-related and uncertainty related, and there is a chance other things are going on.”

However she also acknowledged that some part could be due to Brexit uncertainties.

“If I’m a company, and I know that in a month there will be a vote which might change my input costs, who I am selling to, it makes sense to delay having new workers, starting a new project or agreeing to a big salary increase until after that uncertainty. That could explain some of the softening. If that is the case, if there is a vote to remain, then that uncertainty is lifted quite quickly.”

However, she fell short of saying what other potential uncertainties could be.

Ms. Forbes has been the one to be on hawkish side of the spectrum, with her considering weakness in the economy, could mean lower rates for longer.